Yesterday, the MF Global collapse took center stage on Capitol Hill. The threat of crony capitalism and the sanctity of customer money in US markets hangs in the balance. The unprecedented disappearance, loss, and theft of customer money (1.6 billion dollars worth of customer money to be exact)
kept in segregated accounts remains unexplained. And as MF Global executives yesterday -- legal counsel, CFO, and assistant treasurer -- came to answer questions, what did their answers reveal? Not much unfortunately. General Counsel of MF Global Laurie Ferber, Chief Financial Officer Henri Steenkamp, and Christine Serwinski, former chief financial officer of the company's brokerage unit, all seem to know nothing! In fact, listening to the testimony, you would think that this firm ran on autopilot...
Where have we seen this before? Enron comes to mind. Remember those days of Ken Lay, Michael Kopper, Andrew Fastow who all pleaded the fifth? Apparently, only assistant treasurer Edith O'Brien, would do us the favor of pleading the fifth. The rest of the firm's executives might well have done the same, stammering for the entire length of questioning. So what does all this say about the progress we have made in preventing and prosecuting fraud in our financial markets? It seems that things have only gotten worse since the days of Enron, with political connections and crony deal-making taking over the judicial process. America was built on the backs of individual ingenuity and independence. What is happening to this country, if we cannot protect the rights of the individual? Of the real capitalist? Does someone need to be part of the Goldman Sachs gang or the JP Morgan Mafia to make it today in America? That's what it seems more and more like, and our guest Stanley Haar has taken this matter personally. Not only did he have his own money at stake with MF Global, but he is also a founding member of the commodities customer coalition, and has made it his personal mission to educate members of congress and the press on the significance of and precedence that the case of MF Global sets for our financial markets, our economy, and the position of the individual investor and citizen in this country and around the world. Stanley is president of Haar Capital Management, and he sits down with Lauren in studio to discuss the latest on MF Global, and the unprecedented details of this case.
And last but not least, in our Loose Change segment of today's show, we examine another absurdity of government regulation: Pink Slime. You heard right. After the market said it didn't want ammonia and leftover meat mush pink slime in its meat, guess who is fighting back? The government! The department of agriculture and the governors of five states want to bring it back to life. We'll let you know what we think.